Wednesday, 12 December 2007

Madrid reviews down to 3% growth for 2008

The Spanish Minister of Economy table now on 3% growth next year, instead of 3.3%, after a level close to 3.8% in 2007. The pace of growth is slowing for several quarters.

Even revised downwards, Spanish growth should remain strong and always coveted. It will be about 3% in 2008, said Tuesday that the Spanish Minister of Economy and Finance Pedro Solbes, slightly less than the official forecast, which was previously at 3.3%.

Growth 2008 "will be around 3%," said Pedro Solbes at an economic forum in Madrid, confirming earlier statements where he had anticipated an increase in GDP Spanish for next year by 3%. The forecast of 3.3% for 2008 had been prepared before the financial crisis of August and a downward revision that figure was expected.

For 2007, "growth will be about 3.8%," added the minister, in accordance with the government's official forecast. In the third quarter, the pace of economic growth slowed to 3.8%, and 0.7% in quarterly variation, versus 4% and 0.9% in the second quarter, a performance mainly due to the moderation of household consumption.

This level of 0.7% has placed Spain in the euro-area average, whereas previously it was well above. With annual change, however, the country remains significantly above average in the euro area (2.6% in the third quarter). Spain has in recent years experienced a phase of economic expansion with growth of GDP intense, but this ferment is being moderate especially in the real estate field.